While apparel and footwear spending in the U.S. appears to be decelerating, Baby Boomers aren't likely to slow their consumption in the new year.

While overall apparel and footwear expenditures in the U.S. appear to be decelerating, the Baby Boomers — who make up about one-fourth of the U.S. population — are not likely to significantly slow their consumption levels in the new year, experts say, especially on their beloved apparel.

That’s because for Boomers, most of whom came of age during the Sixties when music and fashion took revolutionary turns, apparel has evolved into a vehicle of personal expression and identity. Moreover, female Baby Boomers have a seemingly insatiable desire to keep their closets updated with trendy apparel.

“Boomers will not deprive themselves,” said Brent Green, author of the book “Marketing to Leading-Edge Baby Boomers” (Paramount Market Publishing, 2003). “Their identity is tied up with how they dress. Boomer women today are fashion conscious just as they always have been because they have been catered to from the beginning by the fashion industry.”

But the picture isn’t forever rosy. Five to 10 years from now, consumption levels for this group might change as disposable income gets pressured in the wake of retirement, partly because experts say the self-indulgent Boomers aren’t as good at saving money as past generations. That would be quite a change for the group, which spends about 40 percent more than other generations, said Cynthia Cohen, president and founder of Strategic Mindshare, a retail and consumer product consultancy.

Yet, just as they have propelled apparel spending in the last decade — in part because of their sheer numbers — Boomers are expected to continue spending, at least into 2005.

The Baby Boomer generation, most commonly defined as those born between 1946 and 1964, will be between ages 41 and 59 in 2005. They are often seen as two separate groups: the Leading-Edge Boomers and the Trailing-Edge Boomers, or Late Boomers. Leading-Edge Boomers are generally those born between 1946 and 1953 and consist of between 37 million to 38 million people, while Late Boomers are those born between 1954 and 1964.

“Boomers “were in their 20s in the mid-Sixties during modern feminism, the [Vietnam] war, environmentalism. They had the attitudes and style and the thought leadership of the kind of revolution in values which affected the revolution of fashion, as well,” said Green, who cited London designer Mary Quant as one who has forever shaped the fashion focus of Boomer women.

Quant, with her miniskirts, sleeveless dresses and tight, skinny ribbed sweaters, has been described as the “Beatles of the fashion industry.”

“As the Beatles revolutionized music…they became the most popular group in history; Mary Quant fashions became the most popular among Boomer women,” Green said. “With the relaxing of social conventions, women wanted clothes to be flexible. Fashion became a signifier of your social attitudes and reflected revolutionary thinking.”

But don’t be fooled into thinking Boomers want to be on the cutting edge of fashion trends. In fact, Boomers — predominantly women — are content to be merely “in style” and will find a way to make sure that happens, even if it means buying fewer clothes should disposable income come under pressure, said Green.

For the time being, though, Boomers, many of whom are now entering the “empty nest” phase, have more disposable income than they’ve ever had, said Green. That’s partly because many Boomers are nearing the peak of their earnings potential and have paid off their mortgages.

Also, Boomers are beginning to experience a transference of wealth from inheritances. Several economists estimate that between now and 2050, $20 trillion to $30 trillion will change hands. Assets will transfer from the parents of Boomers to the Boomers, and then to the children of Boomers over the next five decades.

A third-quarter Luxury Institute report found that, by 2010, the spending power of older Baby Boomers, who will be ages 55 to 64 at that time, will roughly double to $750 billion from $455 billion, according to data from the Conference Board. And by 2013, citing statistics from Lincoln Financial, the report said “the number of millionaires will triple as a result of inheritances.”

Another trend expected to impact Boomer expenditures is later retirements. Milton Pedraza, chief executive officer of the New York-based Luxury Institute, noted that many Boomers plan to work beyond the age of 65, which makes their spending today less affected by what they won’t have tomorrow.

“This trend of continuing to work beyond traditional retirement age has powerful implications for luxury marketers, not to mention its potentially positive impact on the solvency of Social Security and Medicare,” Pedraza said in a recent report.

In turn, Baby Boomers have become luxury consumers because they, among the most recent generations to pass through middle age, have the most money and the willingness to spend it.

“People are going to have a lot more income and purchasing power for luxury,” said Pedraza, who thinks consumer spending on luxury apparel will remain healthy, although he — like others — expects some deceleration over the next year.

“Some people are very classic in the way they buy their clothes,” Pedraza explained. “They go back to…the tweeds, the pure classics that we used to identify with old money. As you get older, your desire for fashion sort of tempers a little bit. And so that may have an impact…as Baby Boomers age.”

Aside from luxury goods, travel is another area where Boomers tend to spend a lot of money. All-inclusive trips with $20,000 to $30,000 tabs are common, and retailers have realized that Boomers want appropriate, comfortable, yet wrinkle-free travel apparel.

As a result, “travel fashion has become fashion in many circles,” said Green. Retailers such as Recreational Equipment Inc., L.L. Bean and Chico’s, which offers its Traveler’s Collection of stretchy garments, have become popular among traveling (and more health-conscious) Boomers.

However, effortless spending on high-end goods and vacations isn’t an across-the-board characteristic of the Boomer generation. About one-third of Boomers of both genders is considered impoverished, with total assets of $10,000 or less, according to Green.

A study called “The Lives and Times of the Baby Boomers,” released in mid-December by two Duke University sociologists, backs up the claim. While the report said that, “at midlife, the Boomers live with an even higher standard of living than their parents,” it added that “they also live with more [wage] inequality.”

That is, one in 10 Late Boomers is living in poverty at middle age, according to the study, which analyzed data from the 2000 Census.

Meanwhile, a portion of today’s Boomers might have to curb discretionary spending on apparel, as their wallets are strained by rising health-care expenses and the cost of putting their children through college. There’s also the uncertainty over how much Social Security they’ll receive in retirement.

According to a December report from Ernst & Young LLP, “Baby Boomers in the United States might not have the income needed to retire early, and the cost of medical insurance, a necessity for older Americans, could rise exponentially. In addition, payouts for Social Security and Medicare might be constrained in the years ahead.” The first Boomers will turn 65 in 2011.

Yet, while Boomers will apparently remain self-indulgent in 2005, overall apparel and footwear spending by American consumers now appears to be losing momentum.

According to the U.S. Department of Commerce’s Bureau of Economic Analysis, real personal consumption expenditures on clothing and footwear rose 5 percent in the most recent third quarter from the third quarter of 2003. Comparatively, though, real PCEs on clothing and footwear in the third quarter of 2003 over the same period of 2002 rose 7 percent.

Despite the slowdown in apparel spending, retailers see plenty of opportunity in serving older demographic sets, a space that has been dominated by department stores as well as specialty retailers such as Chico’s FAS and Talbots. And there are new players entering the field.

Gymboree Corp., with its Janeville concept, and Gap Inc. have announced plans to roll out stores next year aimed at women in their mid-30s and older. Meanwhile, start-up Iziz Dezigns has launched a shopping concept, the Atelier Avocado Collection, which features made-to-measure clothing aimed at women 35 and older. It is set to roll out nationwide in 2005.

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